Ticon plans real estate investment trust to leverage AEC demand
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Warehouse firm Ticon Industrial Connection targets asset growth of Bt20 billion over the next three to five years, capitalising on potential demand within the Asean Economic Community (AEC) by issuing a real estate investment trust (REIT) worth around Bt4
Virapan Pulges, managing director of the listed company, said yesterday that the Ticon Freehold and Leasehold Real Estate Investment Trust (TREIT) would initially invest in Ticon’s warehouses and factories, valued at about Bt4.5 billion.
Ticon reported revenue of Bt1.7 billion and net profit of Bt165.9 million for the first nine months of the year, against Bt6.68 billion and Bt1.4 billion respectively for the whole of last year.
Ticon Group’s initial investment in TREIT will not be more than 20 per cent of its asset value, he said.
After TREIT’s initial public offering and listing on the Stock Exchange of Thailand, the company plans to acquire more land for construction of factories and warehouses in order to cater for potential demand arising from Asean integration under the AEC, which comes into effect next year, he added.
Ticon Management’s managing director, Amorn Chulaluksananukul, said the initial investment would be in freehold and leasehold assets, in a 70:30 ratio, with the assets being Ticon Group warehouses and factories.
Those assets total a leasable area of 214,523 square metres, comprising 45 warehouse and factory units in 11 locations on 306 rai (49 hectares) of land.
There are 25 warehouses units with an overall leasable area of 160,523sqm, and 20 factory units covering 54,000sqm.
The asset portfolio has an average age of less than three years, which is considered almost new, Amorn said.
Aside from investment in Ticon Group assets, TREIT will also look at possible overseas investment, including countries within the AEC.
Ticon Group has high confidence in positioning TREIT to be the leading industrial REIT in Thailand, with targeted asset-value growth of about Bt20 billion in the next three to five years, he added.
Mitsui & Co, the group’s strategic partner, will also invest in TREIT. The Japanese company is known as one of the world’s leading management and investment operators for REITs, and has long experience in managing such trusts in Singapore and Japan, especially in industrial and logistics assets.
Mitsui’s worldwide network will offer TREIT an avenue to source for quality industrial properties for future investment. In cementing its strategic partnership with Ticon, the company intends to invest Bt350 million in TREIT.
